Omaha World-Herald writer Cole Epley picked up on an important trend in energy and agriculture: rural families looking to revenue from wind power to keep them on the farm. This has proven true during recent droughts, during low commodity prices, and during difficult market conditions. His story can be found in its entirety here: “Turning to turbines: As commodity prices remain low, wind energy leases offer a welcome source of income for farmers“.
CRESTON, Neb. — The midday sun pushed temperatures past the 70-degree mark late last week while the fifth and sixth generations of the Brockhaus family gathered the last 20 acres of the fall harvest near here.
Brothers Terry and Steve Brockhaus, along with Steve’s sons Jeff and Jon, typically reap corn from these fields, but as a slight westerly breeze picked up, Steve Brockhaus looked southward over the last remaining rows of the 2016 corn crop to the purveyors of their newest cash crop: four 1.7-megawatt General Electric wind turbines.
“I’m surprised on days like today when it seems like there’s hardly any wind on the ground and they’re still turning,” Steve Brockhaus said.
Turning they were on Thursday, feeding clean power into the Loup Power District grid as they have since they were commissioned in December 2015.
On top of that, the Brockhauses see other benefits: Farming around the four turbines that straddle Mason Road on about 200 acres of irrigated farmland is a veritable breeze, said Jeff Brockhaus, 26.
“They don’t take any ground up,” Terry Brockhaus said.
And the land-lease payments of about $32,000 that landed in the Brockhaus farm coffers from Omaha-based Bluestem Energy Solutions in January are a welcome source of income as millions of American farmers struggle through yet another year of cratered commodity prices.
Wind energy, the fastest-growing source of electricity in the U.S., is transforming low-income rural areas in ways not seen since the federal government gave land to homesteaders 150 years ago. As commodity prices threaten to reach decade lows and farmers struggle to meet debt payments, wind has saved family farms across a wide swath of the heartland.
The Brockhauses about four years ago got out of the cattle business, and they sold off all their hogs the following year. The family farm is by no means in trouble, but livestock prices became too volatile and fell too low, said Steve.
“There ain’t no money in them,” he said. “I’d take turbines any day.”
In states neighboring Nebraska where wind development is in relatively nascent stages, crop and livestock producers also have woken up to the benefits of wind.
The money that Richard Wilson earns from leasing his land for about 35 turbines run by the Golden West Wind Energy Center outside Colorado Springs, Colorado, has kept him from having to sell off pieces of the 6,000-acre cattle and wheat ranch his family has owned since 1948.
“We weren’t making enough money to sustain ourselves,” he said. “Now we’re in a position where we can operate our farm for another generation, at least.”
For others, turbines spin off six-figure incomes that have allowed them to retire from farming altogether.
“One turbine has changed my life,” said Ed Woolsey, a fifth-generation Iowa farmer and a principal with Crosswinds Energy Project, a community collective that manages 10 turbines and sells the power they generate to rural electric cooperatives. “Before, I raised corn and soybeans and cattle. Now I don’t. I’m a wind farmer.”
Woolsey leases his farm to others to cultivate. Neither he nor Wilson would disclose how much he earns, but landowners who sign lease agreements with wind companies typically get between $7,000 and $10,000 per turbine each year.
The more than $100 billion that companies have invested in wind power in low-income counties — where about 70 percent of wind farms are located — has helped double assessed land values in some of the poorest parts of rural America. That has provided a much-needed infusion of local tax revenue that’s being used to rebuild schools and pay down debt.
A five-year extension of a federal tax credit on wind production, passed at the end of last year, should accelerate the construction of turbines. The credit pays wind power producers 2.3 cents for every kilowatt-hour of electricity generated for a 10-year period. That incentive should help double U.S. wind power capacity to 167 gigawatts — enough to power 50 million homes — by 2030, according to Bloomberg New Energy Finance.
By 2030 rural landowners are projected to reap as much as $900 million a year by leasing land to wind developers, said Alex Morgan, North American wind energy analyst at BNEF.
In Oklahoma, wind farms are projected to return $1 billion in property taxes to counties and school districts over a 40-year period. Increased tax revenue has already helped the state weather the decline in the oil sector and allowed some school districts to forgo state funding.
In Platte County, Nebraska, where Omaha-based Bluestem is readying to install four more turbines for a second phase, the energy developer will pay nearly $24,000 in annual property taxes for the first phase. According to 2011 data from the Tax Foundation, that’s the same as adding about 14 new taxpayers to the rolls.
“That’s pretty good for rural areas losing population,” said Adam Herink, vice president of Bluestem. “Infrastructure opportunities for rural Nebraska are few and far between. This brings income and property tax relief, which everybody needs.”
In Iowa, which got 31 percent of its power from wind in 2015, more than any other state, money from turbines has protected farmers from falling corn prices. Annual lease payments of about $17 million helped some avoid foreclosure as they prepared for a record corn harvest that could drive receipts to a 10-year low. Tim Hemphill, a corn and soybean farmer outside Milford, gets about $20,000 a year for leasing land for turbines. “A few years ago corn was $7 a bushel,” he said. “Now my cost to raise it is $4.20 and (the price) could fall to $2.70. It’s going to break a lot of people.”
Wind also is keeping power prices low across much of rural America. In the 11 states that produce more than 7 percent of their power from wind, electricity prices fell 0.37 percent from 2008 to 2013; nationwide, power prices were up 7.7 percent during that period.
Warren Buffett’s MidAmerican Energy is negotiating with landowners for leases to build a $3.58 billion series of wind farms across Iowa, the largest economic development in state history. The company by the end of this year will commission its Grande Prairie wind farm in Holt County, Nebraska, which will be home to the largest wind project in state history at 400 megawatts.
Back in Iowa, land agents also are in discussions with hundreds of farmers there who stand to profit from $1 billion in new projects planned by Alliant Energy.
“This is our financial future,” said Michael Nolte, a farmer who sits on the Franklin County Board in Iowa. This year the board voted to lower property taxes after it paid off a bond used to fund $18 million in road and bridge improvements. Surrounding counties had recently been forced to close bridges that could no longer support heavy farm machinery, and they lacked the money to fix them.
“It’s helping us survive and maintain services,” Nolte said, “whereas other counties have had to make cuts.”
In Platte County on Thursday, Steve Brockhaus said the Bluestem development makes him feel particularly thankful for his many blessings, including the opportunity to help the county and local Loup ratepayers:
“It ain’t too often you can help everybody in the county by lowering taxes and help everybody on the Loup grid.”
This report includes material from Bloomberg News
Mr. Epley can be emailed at email@example.com.